Frequently Asked Questions

We do not charge for quotes, where possible we provide indicative pricing online, but even when our brokers call around for more complex cover there is no charge to the customer, and no obligation to buy

Apart from Car Insurance, which may reduce with a no claims discount (NCD) most types of insurance that will follow an upward trend in premium levels over time.

Year-on-year medical insurance premium growth can be significant due to a number of factors. The cost of medical treatment generally exceeds the rate of inflation. Some notable countries with high medical inflation include Malaysia, China, and Indonesia. Hong Kong is the 2nd most expensive territory in the world for private medical treatment at the time or writing (1st place goes to the USA)

Medical insurance premiums are calculated to ensure that the most sick do not pay the full cost of their misfortune, which drives increases for everyone. The shared liability concept, means individual policyholders will not be penalised with a bigger premium following a large claim.

We can advise you on strategies to bring down the total cost, for example by taking on an excess or deductible, or in some cases by paying for premiums monthly rather than annually which may make budgeting less of a burden

There is no way to answer this question in a vacuum. Where possible we have provided comparisons of at least 2 companies for specific products online. Where products are a bit more complicated please fill out the form for a quotation and we will get back to you as soon as possible

Maternity cover is expensive, and the claims cost the Insurance companies a lot of money. As a result they usually insist on a waiting period before getting pregnant. This may be 6 months or more, meaning that you would not be able to claim for pregnancy in the first year of cover.

In Hong Kong the public health system is excellent, so please do not panic if you are already pregnant. If you are planning on getting pregnant but have not yet conceived you may wish to take family planning advice, and begin a medical cover which includes maternity cover in the interim.

There is a generally accepted principle that as we age we are more likely to develop age related conditions which may be excluded from an insurance policy if we take one out after the condition has been diagnosed. As a result it is usually cheaper, and safer to start with a good policy and maintain it.

This principle is worth considering if you have insurance through your employer, as you may find it difficult to get private cover if and when you change employment. our advisors will be happy to talk to you about how to manage the cost of taking cover early to avoid this situation

We can help with most adventure and extreme sports, whether this be in Hong Kong or overseas. Please contact us directly to explain your circumstances and we will do our best to put the appropriate cover in place.

Well spotted! Yes Asia Pacific Investment Advisors Limited a member of Professional Insurance Brokers Association (0260) acquired SpeedInsure last year. We have now contacted most of the customers and informed them of this change - which will not have any impact on service levels or on prices.

The idea of insurance is that if a large number of people each pays some money into a pool, then sizable sums of money can be drawn from the pool to ease the hardship of those who might suffer losses. In short, insurance is the science of spreading risks.

In practice, insurers manage the money (called "premium") paid by policyholders. In good years when claims are few, insurers are able to build up substantial reserves of money to cater for bad years when claims are heavy. Insurers are responsible for managing their business carefully so that they remain financially sound to pay out claims at all times.

Insurance contracts are based on trust. The insurer trusts the policyholder to give precise and true details of the subject matter to be insured. This is called the principle of "Utmost Good Faith". Care should always be taken to tell the whole truth so that insurance companies can be fair in their assessment of risk. Equally, having effected an insurance policy the policyholder should read all the documentation very carefully to ensure that he understands the exact nature of the policy he has bought and the risks it does and does not cover.

There are many kinds of insurance. A personal insurance policy is one that is taken by an individual person for the benefit of himself or his dependents.

"Insurable Interest" is the right of the policyholder to effect insurance, arising out of certain relationships that may exist between the policyholder and the subject matter insured. Generally speaking, if the policyholder suffers direct losses arising from the subject matter's meeting with misfortune, then Insurable Interest exists. Without Insurable Interest, insurance protection would be speculative in nature, and not be enforceable under the law.

The most common example of Insurable Interest is the ownership of property. There are many other examples, such as being an employer of workers, or a custodian of assets.

Sometimes during the term of an insurance policy, the policyholder might end the relationship with the subject matter insured. If this happens, Insurable Interest ceases and the insurance cover also automatically ends. A common example might be the sale of a car or a flat. The policyholder should take care to notify the insurer of such changes promptly.

By the principle of "Indemnity", an insurance policy compensates the policyholder only to the extent of the value of the property which he has lost, hence a policyholder should not expect to make any profit from a claim.

Indemnity applies to all classes of insurance but is not always easily discernable in certain classes like "Personal Accident" or "Life Assurance". In theory, human life is invaluable but with Accident and Life coverage the insurers will review circumstances of the applicants to determine the amount of coverage that they can reasonably issue to cover any projected loss.

For the insurance of property, if the insured subject matter has depreciated in value at the time it is lost, the insurer pays the policyholder only the depreciated value. This is called "Indemnity Basis". There is an alternative arrangement called "Reinstatement Value Basis" which pays for the new replacement value at the time of loss without deducting depreciation.

For policies to which "Indemnity" applies, the purchase of several policies to cover the same subject matter will not result in the obtaining of claims payments of several times the value of the subject matter. The insurers simply "contribute" to make up the amount payable as if only one policy had been issued.

For policies to which "Indemnity" does not apply, the contribution factor does not apply either.

Health insurance offers protection in case of illness or disability. Health insurance is not the same as medical insurance.

Dread Disease
These policies offer a lump sum in the event that the person insured contracts a critical illness, such as cancer or heart disease. Most dread disease policies also provide benefits in the event of death, thus providing a payment in lieu of a critical illness for which a policyholder has not previously claimed. It is quite common for these kinds of policies to be added to whole life or endowment plans in the form of a rider.

Income Replacement Plans
These offer a percentage amount of the insured's salary to replace his income if he is ill and cannot work for a prolonged period of time. This is paid regardless of whether he is in hospital or not.
Also offered are hospital income plans. These offer a fixed cash sum for each day spent in hospital, so helping to meet all the usual household bills which still need to be paid.

Disablement Policies
These offer a lump sum in the event that the insured is permanently disabled due to an accident. These are normally attached to whole life or endowment plans.

A monetary limit is usually placed on each item , and an overall limit per year or per hospitalization may also be imposed.

Surgical and anaesthetists fees are normally reimbursed according to the complexity of treatment or alternatively, a fixed percentage for each type of treatment.

"Outpatient Benefits" or "Consultation Benefits" cover the cost of consultation with a general practitioner or specialist, long-term medication, laboratory treatment and diagnostic charges.

A monetary limit is usually placed on each item , and an overall limit per year may also be imposed.

It is possible to purchase coverage for other types of medical expenses such as maternity or dental costs. Some insurers will also cover, on request, costs of visits to herbalists, bonesetters and acupuncturists

The following illustrate a good representation of the more common exclusions. The number and content of exclusions vary from insurer to insurer.

Extra hazardous causes such as radiation, war and dangerous activities

Many situations exist where a person might unintentionally cause damage to property or bodily injury to others and so become responsible for compensating the victim.

A "Personal Liability" insurance policy can provide indemnity to the policyholder if he is held legally liable for such accidents. It also covers the personal liabilities of those policyholder's family members who reside with him.

It does not cover personal professional liability, such as medical practitioners or lawyers who are personally liable for their own professional negligence.

For personal valuables like jewellery, watches, fur coats, antiques and works of arts, an "All Risks" insurance policy can be effected to cover the valuables on an "agreed value" basis, against any loss or damage. It does not usually cover losses brought about by the policyholder's personal vices, depreciation, wear and tear, or the action of mildew, insects and vermin.

Some policies provide a scale of percentages of the lump sum payable, depending on the extent of the disability, whilst some policies provide benefit only for a specified injury or loss, e.g. an eye or a limb.

"Temporary Disablement Benefit" pays a weekly payment to the policyholder if he is prevented by his injury from working. Many policies limit payment to 104 weeks.

"Medical Expenses Benefit" pays for the consultation and hospitalization costs incurred by the policyholder for the treatment of his injury.

This insurance usually covers accidents, whether the policyholder is on business or at pleasure anywhere in the world.

It does not cover illnesses, and dangerous sports like parachuting or hang gliding.

The average household is not immune from common misfortune such as fire, theft, the bursting of water pipes, or gas heater explosions. Sometimes, typhoons can be extremely destructive and the heavy rainfall that accompanies them may cause floods and landslides.

Loss of or damage to household contents such as furniture, decorations, electrical appliances, kitchen utensils, clothing and personal valuables can be insured by a "Householder's Comprehensive" insurance policy which provides cover in one package for:

Household employees in Hong Kong perform a myriad of duties, ranging from indoor work like cooking, cleaning and washing, to outdoor work like shopping, driving and delivering. Therefore they are exposed to similar injury risks as any other commercial employees.

Under the Employees' Compensation Ordinance, Chapter 282 of the Laws of Hong Kong, the employer must compensate his employees for any accident arising out of and in the course of the employees' employment, regardless of whether the employees' carelessness has caused the accident. Under the Ordinance, it is also compulsory for the employer to effect insurance with an authorized insurer.

An "Employees Compensation" insurance policy covers Ordinance benefits such as medical expenses, loss of wages, permanent disablement benefit, and death benefit. In addition, it usually covers common law liability with a policy limit of HK$100 million for any one event.

Policy for employees from other countries may also be extended to cover repatriation expenses following death, injury or illness.

Thefts and traffic accidents are a great concern to car owners since they can cause bodily injury or death, and can also incur huge expenses. Under the Motor Vehicles Insurance (Third Party Risks) Ordinance, Chapter 272 of the Laws of Hong Kong, the user of a motor vehicle on the road must insure his liability for death or bodily injury of third parties with an authorized insurer.

The common forms of "Motor" insurance policies include:

Act Only - covers only the minimum legal requirements for third party death and bodily injury.

Third Party Only - covers third party property damage in addition to the Act Only category.

Third Party, Fire and Theft - covers loss or damage to the policyholder's car caused by fire or theft, in addition to the Third Party Only category.

Comprehensive - covers any accidental loss or damage to the policyholder's car, in addition to the Third Party Only category.

Motor insurance is one area where insurers enthusiastically encourage safe driving, by granting a "No Claim Discount" if a policy remains claims-free.

In general, motor policies do not cover a driver's own death or injury.

Under the Merchant Shipping Ordinance, Chapter 281 of the Laws of Hong Kong, the owner of any pleasure vessel used in Hong Kong waters must insure his liability for the death or bodily injury of any third parties with an authorized insurer.

Similar to the conditions laid out for motor insurance, a "Marine Hull" policy can cover only third party risks, or the vessel's own damage risks.

Extensions are available for water sports risks, racing risks, and navigation outside Hong Kong waters.

Many insurers require the insured vessel to be moored in a typhoon shelter whenever a typhoon signal no. 3 or above is hoisted.

Given the large number of insurers available in Hong Kong, any insurance buyer should consider obtaining several quotations for comparison before committing himself to an insurance policy. He should look for insurance companies that provide good security, a reputable claims service, reasonable prices and prompt documentation.

Purchasers of insurance can procure the assistance of insurance agents and brokers, both of whom will be pleased to help. Any buyer should also look for prompt, efficient and helpful service from these intermediaries.

Insurance agents are responsible to the companies that they represent. They can represent as many as four companies of which no more than two shall be life assurance companies, but in many cases, life agents represent only one company. Agents are trained by their companies and are fully familiar with all company procedures and policies.

Insurance brokers are not employed by insurance companies, and are therefore often able to offer a wider choice of policies.

If preferred, an insurance buyer can telephone an insurance company directly. This process should provide him with some idea of the insurers' standards of service. He can then visit the office of his choice and arrange his policy. Note that this does not usually mean a cost saving for the customer.

Insurance contracts are contracts of "Utmost Good Faith". Since the insurer bases any premium and policy terms on the information provided by the insurance buyer, the buyer is expected to be truthful.

A proposal form (sometimes called an application form) is usually provided, so that the buyer can fill in the required information. At the conclusion of the form where the buyer affixes his authorized signature, appears a "declaration clause" which states that the information provided by the buyer will be the basis of the contract, and that such information should be true to the best of his knowledge. A buyer must carefully read any proposal form before signing it and ensure that all the information disclosed is correct and complete. It is worth remembering that revealing extra information does not preclude anyone from obtaining insurance, it simply allows the insurance company to fairly share the risks it is being asked to take.

The duty of the applicant to provide updated information remains a continuing duty throughout the policy period. Any material changes in circumstances should be notified immediately by the policyholder to the insurer or intermediary.

If a policyholder has given false information or hidden material information, then his policy can be declared null and void.

This means that the policy will be deemed not valid, and no claims will be entertained.

(In the case of online insurance application, the action of clicking the submit or apply button is equivalent to signing a paper-based application form.)

For most property insurance, the "Average Condition" parameter applies, therefore selecting an appropriate insurance sum is delicate matter. Under policies where the "Average Condition" applies, any under- insurance conditions will be penalized by deducting from the claim the percentage of the amount under-insured. As for over-insurance, no penalty is exacted and no extra gains procured, because such claims are limited to the actual amount lost.

The policyholder must remember that it is the value of any item at the time of loss which is used to determine any under-insurance liability. At the time of proposal, the sum insured may be accurate but after a few months, the sum insured may become inadequate because more property has been purchased. Therefore, the policyholder should safeguard against any unintended under- insurance by regularly updating the sum insured under the policy to include new additions.

As regards life assurance, choosing the appropriate sum can be more difficult because the value of a human life is considered inestimable.

The chosen insured sum should always be compatible with the income and lifestyle of the assured. Grossly exaggerated sums of life assurance are not permitted.

When any policyholder receives a policy, he has a duty to read it carefully. He should raise promptly any queries with the insurer if he sees anything not in order, and request the necessary amendments.

Many insurance policies are difficult to read, generally because many established principles and practices have to be condensed into as few words as possible on the policy. Many insurers are still using archaic policy wordings because these wordings are well established and have been interpreted many times in court. In certain respects, such wordings can actually work to the advantage of both the policyholder and insurer provided that they both understand the interpretation that certain words will be given in court.

In order to improve the situation for the general public, insurers are moving towards a plain-English policy wording, whilst some insurers also provide a Chinese translation. The Glossary of Insurance Terms compiled and published by the Hong Kong Federation of Insurers aims to provide a standard Chinese translation of more than 1,000 commonly-used insurance terms.

After any loss has occurred, the policyholder should call the insurer's claims department or the insurance intermediary as soon as possible to ask for instructions. The insurer will probably request the policyholder to complete a claims form and provide information.

Regarding property claims, the insurer usually appoints an independent loss-adjusting firm to survey the loss. Even though the adjuster's fees may be paid by the insurer, he remains fully independent and unbiased. Many insurers have been known to pay out heavy claims without inspecting the damaged item, having relied entirely on the adjuster's report.

If a policyholder keeps his records properly, any claim can usually be speeded up considerably. Claims are often delayed because the lost items cannot be substantiated by proper receipts. When the adjuster's final report is completed, the insurer is in a position to offer a claim payment to the policyholder. Upon the agreement of the policyholder, the insurer sends a "Claim Discharge" form for him to sign, after which a payment cheque follows.

Regarding liability claims, the insurer may or may not send an adjuster, depending on the nature of the accident.

In all cases, it is very important for the policyholder to pass to the insurer all relevant letters and documents from third parties. The policyholder should not admit liability or try to negotiate with any third parties unless the insurer consents to this action.

Since it is the third party who is claiming against the policyholder, the insurer cannot control the third party by advising him how to claim. Sometimes, the third party may proceed slowly, and this is one reason why the settlement of liability claims can be extremely protracted. Once the third party has provided full information and evidence, the insurer is then in a position to offer payment to the third party.

Regarding life assurance claims, it is always necessary to provide certain documentation, such as birth and death certificate of the assured to the insurers. The insurer will provide full details of exactly what is required.

For health and related claims full medical evidence is usually required by the insure